Molycorp increasing rare-earth production

By Zhang Ye Source:Global Times Published: 2012-7-31 0:15:03

Molycorp (MCP), the largest rare-earth producer in the US, announced that it would scale up its rare-earth production, increasing its share of the global market from the current 4 percent to 30 percent, without providing a time schedule, the Beijing Business Today reported Monday.

The company plans to invest $895 million in its rare-earth business and double its output capacity from 20,000 tons to 40,000 tons, the report said.

Some analysts said the move will put pressure on Chinese exports of rare earth. "This would definitely influence China's rare-earth exports in the future and help the US rare-earth industry reduce its reliance on Chinese exports," Chen Zhanheng, director of the academic department of the Chinese Society of Rare Earths, told the Global Times Monday.

Data from the Rare Earth Information Center revealed that the main buyers of China's rare earth are Japan, the US and France, with the US ranking the second. Between 2004 and 2008, the US purchase of Chinese rare earth declined from over 16,000 tons to 8,000 tons.

However, the Molycorp expansion plan will have little impact on China's rare-earth sales on the whole, as bulk of the country's output is used for domestic consumption, said Chen. China produced 96,900 tons of rare earth in 2011 and exported 18, 600 tons.

The announcement comes after the World Trade Organization announced on July 23 to set up an expert panel to investigate into China's export policies on rare earth, tungsten and molybdenum, following complaints from the countries like US and Japan about China's restrictions on the exports of rare earth.